The manager of a car wash must decide whether to have one or two wash lines. One line will mean a fixed cost of $5,600 a month,and two lines will mean a fixed cost of $9,520 a month. Each line would be able to process 15 cars an hour. Variable costs will be $3per car, and revenue will be $5.95 per car. The manager projects an average demand of between 14 and 18 cars an hour. Would yourecommend one or two lines? The car wash is open 280 hours a month..Chooseline

Formula for contribution margin= Sale price - variable cost

Answered: The manager of a car wash must decide…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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